Rongde Asset Management Co. Ltd., the first sino-foreign asset management firm approved by the Chinese authorities, was officially inaugurated in Beijing on Tuesday.

Huarong Asset Management company, one of the four firms established to handle the bad assets of China's big four state-owned commercial banks, has a 51 percent stake in Rongde, which has a registered capital of 1.788 billion yuan (236 million U.S. dollars).

International Finance Corporation (IFC), the private sector arm of the World Bank Group, holds a stake of 14 percent.

The remaining 35 percent is owned by Cathay Capital Company (No.2) Limited, a joint venture between the Deutsche Bank and the America International Group (AIG)

Huarong's deputy president Zheng Wanchun will be the chairman of the new company.

Ding Zhongchi, the president of Huarong, said the inauguration of Rongde meant foreign investors had begun to invest in China's bad asset management market.

The three other Chinese bad asset management firms are Great Wall, Cinda and Orient.

The four firms received hundreds of billions of yuan worth of bad assets stripped from the four banks -- the Bank of China, the Industrial and Commercial Bank of China, the China Construction Bank and the Agricultural Bank of China.

Preparations for the launch of Rongde were started by Huarong in September 2005. The three foreign partners were chosen through an international bidding process.

Source: Xinhua